Andromeda Metals passes key milestone by submitting mining lease application for Great White Kaolin Project

Andromeda Metals Ltd (ASX:ADN) has achieved a key milestone with applications lodged for a Mining Lease and two Miscellaneous Purposes Licences for the proposed development of the Great White Kaolin Joint Venture Project with Minotaur Exploration Limited (ASX:MEP) on South Australia's Eyre Peninsula. The application has been lodged with the South Australian Department for Energy and Mining (DEM) with a decision expected from the Minister for Energy and Mining later in the year. Lodgement of the applications represents a milestone in the project’s development which remains on schedule with a definitive feasibility study on track for completion in the second quarter of 2021 and for the commencement of operations in February 2022. Shallow open pit mine proposed The application outlines the proposed development of a shallow open pit mine, wet-processing plant and supporting infrastructure at the Great White Deposit, which is in line with the project pre-feasibility study. This application includes: A Mining Lease (ML) for the mine, processing plant and supporting infrastructure; A Miscellaneous Purposes Licence (MPL) for an access road to the ML; and A MPL for a water supply pipeline from Poochera to the ML. A mining proposal and management plan supports the application which incorporates supporting environment impact assessments undertaken by independent experts. Shares have been more than 9 per cent higher in early trade to 35.5 cents, approaching the record high of 36.5 cents set last November while the company's market cap has grown to approximately $700 million. Staged development The mining lease submission is founded on an operation to be developed in two stages: Stage One – to produce up to 600,000 dry tonnes per annum of direct shipping ore (DSO) for toll processing overseas and including construction of the site access road, internal haul roads and the initial pit; and Stage Two – processing on site of around 500,000 tonnes per annum of ore to produce up to 250,000 tonnes per annum of refined halloysite- kaolin product with the construction of a wet-processing plant, water pipeline and LPG generator. The final project scope and configuration is currently being evaluated under the definitive feasibility study, due for completion in the second quarter of 2021. Stakeholder engagement The application includes details of the existing cultural, social, economic and natural environment with all information designed to assist State Government agencies and stakeholders to make an informed assessment about the potential impacts, risks and benefits associated with the proposed development. Andromeda is committed to actively engaging with stakeholders during the Government’s public consultation process and throughout all stages of the proposed development. The proposed development will provide a range of economic benefits to the Eyre Peninsula region, and over the estimated 26-year expected mine life (plus the initial investment year) the direct wage contribution is expected to be $178 million (an average of $6.6 million per year). Direct local employment will be comprised of a peak of approximately 75 full-time equivalent jobs directly employed on the mine site (including haulage). The Great White Kaolin Project. Next steps The company will continue to engage with key stakeholders, including landowners and the District Council of Streaky Bay. Should a mining lease be granted, Andromeda will prepare and submit a Program for Environment Protection and Rehabilitation (PEPR), which is required under the Mining Act 1971 to enable the commencement of mining operations scheduled for February 2022.